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Texas Department of Insurance
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28 TAC §§5.9800 - 5.9811

1. INTRODUCTION. The Texas Department of Insurance proposes repeal of §§5.9800 - 5.9811, concerning temporary rate reductions for certain lines of liability insurance affected by tort reform legislation enacted by the 73rd and 74th Legislatures. Repeal of these sections is necessary because the need for the rules has been eliminated. The rules establish the methodology to be followed and provide the loss and ALAE reduction percentages to be used to determine the rate reduction factors for the lines of liability insurance affected by the tort reforms such that savings from the tort reforms would be passed to all insurers' policyholders on a prospective basis. The final loss and ALAE reduction percentages were applicable to policies effective on or after January 1, 2000, but before January 1, 2001. The repeal of Insurance Code Article 5.131, effective April 1, 2007, requiring mandatory rate reductions, further obviates the need for the sections. The Department identified this section for repeal as part of the Department's ongoing review of existing rules pursuant to Government Code §2001.039.


2. FISCAL NOTE. J'ne Byckovski, Chief Actuary, Property and Casualty Division, has determined that during the first five years that the proposed repeal is in effect, there will be no fiscal impact on state or local government. There will be no measurable effect on local employment or the local economy as a result of the proposal.


3. PUBLIC BENEFIT/COST NOTE. Ms. Byckovski has also determined that for each year of the first five years that the proposed repeal is in effect, the anticipated public benefit will be the removal of obsolete and potentially confusing provisions from the Texas Administrative Code. There is no anticipated economic cost to persons who are required to comply with the proposed repeal. There is no anticipated difference in cost of compliance between small and large businesses.


4. REQUEST FOR PUBLIC COMMENT. To be considered, written comments on the proposal must be submitted no later than 5:00 p.m. on July 23, 2007 to Gene C. Jarmon, General Counsel and Chief Clerk, Mail Code 113-2A, Texas Department of Insurance, P.O. Box 149104, Austin, Texas 78714-9104. An additional copy of the comment must be simultaneously submitted to J'ne Byckovski, Chief Actuary, Property and Casualty Division, Mail Code 105-5F, Texas Department of Insurance, P.O. Box 149104, Austin, Texas 78714-9104. Any request for a public hearing must be submitted separately to the Office of Chief Clerk before the close of the public comment period. If a hearing is held, written and oral comments presented at the hearing will be considered.


5. STATUTORY AUTHORITY. The repeal of §§5.9800 - 5.9811 is proposed pursuant to Insurance Code §36.001, which provides that the Commissioner of Insurance may adopt any rules necessary and appropriate to implement the powers and duties of the Texas Department of Insurance under the Insurance Code and other laws of this state.


6. CROSS REFERENCE TO STATUTE. No statute is affected by the proposal.


7. TEXT.

§5.9800. Purpose and Scope.

§5.9801. Definitions.

§5.9802. Application to Insurers and Monitoring of Insurers.

§5.9803. Rulemaking Procedures for Reductions in Rates.

§5.9804. Loss and ALAE Reduction Percentages by Line.

§5.9805. Calculation and Application of Rate Reduction Factor.

§5.9806. Duration.

§5.9807. Filing Requirements.

§5.9808. Administrative Relief.

§5.9809. Declaration of Inapplicability.

§5.9810. Appeal of Rate Reduction and Severability.

§5.9811. Loss and ALA E Reduction Percentages Applicable in Specified Years.

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